Coinbase first launched its in-house index fund in June for accredited investors willing to allocate $250,000 to $20 million

Cryptocurrency exchange and wallet service Coinbase is shutting down its index fund service due to weak interest from investors since it launched “the S&P 500 index equivalent” of the crypto world earlier this year, sources with knowledge of the move told The Block on Thursday.

As part of its institutional-focused products, Coinbase first launched its in-house index fund in June, opening its doors for accredited investors willing to allocate a minimum of $250,000 to up to $20 million to this fund. The fund was open to investments from U.S. resident accredited investors only.

The initiative was part of the company’s recent move to target a more select group of high-stakes players and institutional investors. It provided them with a way to track the performance of the crypto markets as a whole by holding a single crypto asset. And it leverages the fact that the index funds have consistently beaten the average managed fund since their inception.

Upon the release of the service, however, some investors expressed worries about the fees and lack of support for a wide range of crypto assets. But Coinbase addressed these worries later with a 50 percent reduction in its management fee to one percent annually. The San Francisco-based cryptocurrency exchange has also rebalanced the fund to incorporate new coins, following the listing of additional altcoins.

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False Claims or More Retail Focus?

The decision to shutter the project was in contrast to what Coinbase said a few weeks ago when it claimed about overwhelming interest from investors. However, it may explain why Adam White, the company’s fifth-ever employee and head of the company’s institutional platform group, has decided to leave the company.

At the time, a company spokesman told Bloomberg that “while we’re extremely sad to see him go, we’re also confident in that group’s ability to keep executing on the vision that he laid out to be the most trusted venue for institutional investors to trade cryptocurrencies.”

The Block’s report further states that the move to shutter the fund is driven by Coinbase’s desire to focus on its series of investment tools seemingly geared towards retail investors.

The first is the Coinbase Bundle, which is designed to simplify cryptocurrency trading. It consists of a basket of cryptocurrencies offered by the company, which investors can buy for as little as $25, £25, or €25.